SP pension

Discussion in 'Merck' started by Anonymous, Jun 20, 2014 at 5:48 PM.

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  1. Anonymous

    Anonymous Guest

    From what I understand, the SP pension plan has not merged or integrated with the Merck plan, and won't until 2019?

    I have been reading threads about Merck's plan and I realized I was only confusing myself because the two are very different. We do not have a cash-out option, we have a company pension plan that is similar to an annuity. Correct?

    The other topic of confusion has been the $ amount per month one can expect after 15 years of service, etc.... From what I can tell, the SP plan seems to be more generous in monthly payments than Mercks? We used to get an annual "Total Compensation" book, personalized with our information, salary, benefits, pension and 401-k information and projections, I miss that.

    Has anyone called SP HR (is there such a thing?) to get a recent pension statement? If willing, please post your numbers, years served and approx monthly pension payment. I will do the same when I get specifics.
     

  2. Anonymous

    Anonymous Guest

    Those from SP that made it through the merge were hoodwinked. You are getting half of what Legacy Merck people get. Read the fine print.
     
  3. Anonymous

    Anonymous Guest

    Not so. SP retiree here.
    If you ran comparative (SP vs. MRK) plans per official respective policies available since 2009 onward you would see that for comparable years of service that MRK's calculated plan monthly benefit are lower.
    That's why the 2019 date exists on harmonizing the SP pension plan to the MRK pension plan.

    WHY: Aside from slight differences in respective plan calculations, SP's higher mo. pensions resulted from SP's CEO Hassan modifying SP plans well prior to 2009 to include AIP (bonus) in creditable (i.e., counted in) salary calculation for pension determination, whereas MRK excluded AIP.
    It was important for SP employees to keep an eye the differences in pension plan monthly benefits in anticipation of the eventual "announcement re 2019", especially as poster # 1 states that they missed the "annual "Total Compensation" book, personalized with our information, salary, benefits, pension and 401-k information and projections".
    Clearly close attention and due diligence was necessary for SP folks post the Nov. 2009 acquisition closing.

    IN SUMMARY, while much pro & con can be said about Hassan, it is clear that Hassan recognized the need to pay for performance (& yes, employee motivation and retention) as he was preparing the co. for sale or merger.
    Generally, the same can not be said since 2009 for MRK employees.

    Separate from above, IMHO, SP base salaries were generally higher (vs. MRK's).
    That aside, comparative calculations underlying economically better SP pension plan mo. benefit assumed identical annual base salary in either plan, except for inclusion of AIP bonus in SP's calc.
     
  4. Anonymous

    Anonymous Guest

    Thanks for the post as a SP legacy rep will the harmonization in 2019 allow us to take the annuity or one time payout as Merck has the option to do?
     
  5. Anonymous

    Anonymous Guest

    I am not familiar with the post 2019 harmonization provisions.
    I would expect that both payment options would be available, but this must be verified then.

    That said, and as others have pointed out, the lump sum calculation has been watered down in past several years by many employers, including MRK (due to the continuing period of extremely low Fed. Reserve set interest rates) such that IMHO, the annuity is the clear choice.

    WHY:
    For little or no risk, the pile of money you must have in the bank is huge in order to generate the monthly pension payment form the SP defined benefit pension plan.
    that;s the main reason why companies have moved away from defined benefit pension plans to cash balance plans.
    Bottom line: There is no way that MRK, or other employers will give the equiv. amount of cash to equal the monthly benefit of a defined benefit pension plan.
    If you are in good health, and have a significant other, and are close to social security, then take the annuity pension, which, once the pension is initiated, i.e., purchased from say Northern Trust, or similar highly related insurance co, is also backed up by the US govt. PBGC. (see pbgc.gov)
     
  6. Anonymous

    Anonymous Guest

    Thanks for the info
     
  7. Anonymous

    Anonymous Guest

    Schering got the big dollar severance of 4 weeks pay per year up until 2012.
     
  8. Anonymous

    Anonymous Guest

    Many Merck folks expect the lump sum option to end in 2019. Actually no pension contributions after 2019 for anyone. Don't be surprised to see a mass exodus of everyone 55 and over (if they are not laid off before then). Many early 50s folks are being bridged during Merck's transformation. Too expensive and not easily cowed.
     
  9. Anonymous

    Anonymous Guest

    I was let go in 2013; age early 50's with over 30 years with company (former SP employee) and did not qualify for bridging to 55. I was told that only Merck employees over 50 with 10 years of employment were qualified for bridging. Isn't this hard to believe? Can someone provide input on why I was not qualified for bridging since this doesn't make any sense whatsoever.
     
  10. Anonymous

    Anonymous Guest

    Based on what Hassan negotiated for the Schmering folks. Its just like their severance was double the legacy Merck rate. All based on what Hassan had written in change of control policies. You can thank him.
     
  11. Anonymous

    Anonymous Guest

    Poster # 9 has a good question.

    While Hassan's Change of Control provisions were effective in the period from acquisition deal closure 3 Nov. 2009 until end 2011, it would be logical to assume that SP folk continuing post end 2011 would THEN be deemed eligible by MRK medical eligibility criteria, and certainly not be placed or faced with a surprise "no mans land" as far as post age 50 medical eligibilty with 30 + yrs with the successor "co", unless communications to each employee legacy group confirmed such differences between the legacy groups.
    As such, I cannot recall what, if any, communications to all employees were made near end 2011, or opening 2012, on what the eligibilty criteria for medical coverage / bridging for employees in each of the two legacy groups was going to be, and if different, why?
     
  12. Anonymous

    Anonymous Guest

    For any former SP who left during layoffs over past year or expected SP handraisers this week:
    What health benefits will you have/pay during your severance period and if eligible for health benefits after that, what is your expected cost of health insurance until medicare??
     
  13. Anonymous

    Anonymous Guest

    Left Merck at 53, with 26 years of service in November 2013. Medical (COBRA for first 18 months)for me and spouse cost $235 per month (dental included). Legacy SP separated employees (over 50 but not 55 yet) are not eligible for bridge pension, but are eligible for retiree bridge medical.
    As of today I was not able to verify how much retiree medical will cost me.
     
  14. Anonymous

    Anonymous Guest

    Does anyone know about the Rule of 85 relating to pension? My age and years of service added to 85. I was told that only Merck employees qualify but not former SP folks. I was a former SP employee and was separated by Merck last year. I cannot locate any info where it stated that former SP would or would not qualify. Your input would be greatly appreciated on this as it seems unfair that I would not qualify as former SP employee. Can anyone please comment on this important matter.
     
  15. Anonymous

    Anonymous Guest

    call HR
     
  16. Anonymous

    Anonymous Guest

    The rule of 85 applied to Merck but you have to be under 58 years old in 2014 I believe. But call hr anyway. Good luck.
     
  17. Anonymous

    Anonymous Guest

    Regarding the SP pension...I cannot recall exactly how you get to it but there is a pension plan calculator that you can run, search for pension on Sync and I am sure you can get to it. Here you can plug in different scenarios including when you will leave the company, when you will start drawing your pension and it will calculate your pension under the old formula and under the new. You do not have an option for a one time lump sum like legacy Merck does. For SP legacy you get an annuity for your years of service up to 2012 and then you get the better of the old SP legacy plan versus the new plan that was rolled out. This is only until 2019 when both plans will be harmonized. Double check the 2012, but I am pretty sure. Good luck.
     
  18. Anonymous

    Anonymous Guest

    One thing I just noticed while reading this thread, the behavioral differences between legacy SP and legacy Merck people. This thread is clean, no slander or negativity, no cheap shots or backstabbing. Now go read the rest of Merck's board, see the difference? I miss SP.
     
  19. Anonymous

    Anonymous Guest

    Agree.
    I don't miss Merck.
     
  20. Anonymous

    Anonymous Guest

    You are correct, I have noticed the same. SP's people were so much better than what we have here.